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    Food and Resource Economics Department

Quantifying the Socio-Economic Impacts of Harmful Algal Blooms 

Summary

Florida was impacted by two significant harmful algal bloom events between late 2017 and early 2019. A large Red Tide event occurred on the Gulf Coast and was observed on the Atlantic coast of Florida in 2018. Additionally, blue-green algae affected fresh waters in South Florida including the Caloosahatchee and St Lucie Estuaries. When human communities are exposed to HABs, there can be significant economic losses and damages, which often depend on the size, severity, timing, and duration of the event. However, data limitations often make it difficult to determine the exact extent and value of these economic impacts to local economies. This report, commissioned by the West Coast Inland Navigation District and the Southwest Florida Marine Industries Association, documents select impacts of the 2017-2019 Red Tide event to marine industries and tourism sectors in Southwestern Florida. 

The economy of Southwest Florida is inextricably linked to the Gulf of Mexico, with which it shares several hundred miles of shoreline. Marine-dependent industries such as commercial fishing, marine aquaculture, seafood processing, water transportation, and those that provide marine recreation opportunities are directly dependent on the resources that the Gulf provides. Surveys of for-hire/charter fishing and diving operations as well as marine recreation industries indicated significant impacts resulting from the 2018 Red Tide event. For-hire/charter operations responding to the survey (n=59) indicating average decreases of 61% in sales revenue when Red Tide was present locally, 28% for the remainder of the year and 10% in areas where Red Tide was not present locally. Marine recreation operations responding to the survey (n=59) indicated an average decrease of 36% in sales revenue when Red Tide was present locally, 15% for the remainder of the year and 7% in areas where Red Tide was not present locally.

The Gulf and its associated resources are also important contributors to the region’s aesthetics as well as culture, and provide critical ecosystem services that improve the lives and wellbeing of its many residents as well as its visitors. Additionally, when tourists visit the region they purchase local goods and services that might not appear directly linked to the Gulf but do represent economic activity that is supported by marine-dependent activities such as recreational fishing, boating, beachgoing, kayaking, etc. Statistical analyses of Airbnb reservations suggest that each water sample with a concentration of Karenia brevis above 100,000 cells per liter reduces the average daily rate of Airbnb properties in a county by $0.446 and decreases tourist demand for Airbnb properties by 345 reservation days. Further modeling suggests that declines in Airbnb property visits result in a decline in local visitor spending, with direct impacts of more than $184 million. 

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Suggested Webpage Citation:

Court, C.D., Ferreira, J.P., Ropicki, A., Qiao, X., & Saha, B.B. (2021, July). Quantifying the Socio-economic Impacts of Harmful Algal Blooms in Southwest Florida in 2018. UF/IFAS Economic Impact Analysis Program, Food and Resource Economics Department, University of Florida. Retrieved [date] from https://fred.ifas.ufl.edu/extension/economic-impact-analysis-program/disaster-impact-analysis/harmfulalgalblooms/